Varthana is a non-bank financing company that focuses on lending specifically to affordable private schools in India. Varthana focuses on school entrepreneurs with credibility in their communities, operating schools that charge a monthly fee of $ 5-25 per student.

Varthana is a non-bank financing company that focuses on lending specifically to affordable private schools in India. Varthana focuses on school entrepreneurs with credibility in their communities, operating schools that charge a monthly fee of $ 5-25 per student.

Key details

Social - Education
Private credit - Direct investment

Key metrics

Investment date
December 2019
Target SDGs
Quality education (SDG 4), Decent work & economic growth (SDG 8)
Impact KPIs
Schools served, Students served, Teachers employed

When people can’t get an education, it not only stops them from breaking out of poverty but also puts the growth of entire countries at risk. Access to education in low-income countries is often hindered by a lack of resources and inadequate infrastructure. According to UNESCO, at least 244 million children and youth were not attending school in 2021.

India has experienced tremendous social and economic growth over the past few decades. India is now home to the largest school-aged population in the world; however, the country’s public school system has struggled to keep pace with that speed of development. Instead, an entrepreneurial sector of private schools delivering high-quality education at affordable prices has emerged to meet the growing needs of over 270 million students. These schools often face difficulties in accessing financing to scale their operations.

Given the severity of government-imposed lockdowns in India, widespread school closures during the COVID-19 pandemic materially hindered access to education: the number of out-of-school 6-10-year old children tripled between 2018 and 2020 – a trend particularly apparent in low-income rural areas. School closures have led to decreased learning levels: 90% of children between grades 2 and 6 have lost at least one language ability, while 80% have lost at least one math skill from the previous year. The widening learning gap has been exacerbated by the varying levels of digital access.

Founded in 2012, Varthana aims to improve access to quality education in low-income communities.

The rise of affordable private schools in India can be attributed to their sustainable, low-cost model, emphasizing efficiency and quality education. Despite their positive impact, these schools often encounter financial challenges that affect their growth and sustainability. To increase the capacity and resources at these good quality affordable schools, Varthana provides financing solutions tailored specifically for these institutions – this allows the Varthana-financed schools to invest in technology, new classrooms, and even transportation to help students get to school. This not only impacts students attending Varthana-financed schools, but also increases competitive pressure in the wider private school market, which drives a systemic improvement to the quality of education.

Varthana works towards two main goals:

  • Broaden access to quality education in low-income communities in India: Varthana’s client schools specifically cater to the lower end of the socio-economic spectrum, charging fees of USD 5-40 per month to students.
  • Increase capacity and resources at affordable private schools: Varthana’s financing solutions allow client schools to expand their infrastructure, invest in teacher training and introduce new learning methods into their

Over the past decade, Varthana has played a crucial role by financing more than 9,500 affordable private schools and facilitating over 15,000 loans for school expansion and renovation. With a presence in 16 states/union territories and 40 branches, Varthana also extends its services to Tier III and Tier IV cities, significantly contributing to fostering accessible education in India.

During the COVID-19 pandemic, Varthana launched several initiatives to support schools in an environment where tuition was largely limited to online channels, a technology which had not been widely used by Varthana’s client base until then.

BlueEarth’s commitment empowers Varthana to expand its financial support to a wider network of affordable private schools nationwide, aligning with its overarching vision to enhance and transform the affordable education sector in India.

BlueEarth’s approach to impact measurement is a key differentiator. We leverage dedicated impact expertise, fully incorporated within investment teams and have established an Impact & ESG committee responsible for the implementation and ongoing improvement of BlueEarth’s impact and ESG framework. BlueEarth has developed a leading impact measurement and management framework aligned with impact and ESG industry frameworks, including the Operating Principles for Impact Management, the Impact Management Project, IRIS+, the UN-backed Principles for Responsible Investment, and the UN Sustainable Development Goals.

BlueEarth consistently monitors asset impact performance. Across all asset classes, BlueEarth works closely with the investees’ management to enhance impact strategies. Common key impact metrics are collected and reviewed quarterly or annually and actively drive value creation conversations with the investee.